Science Group Plc · LSE:SAG
Science — FY2020 Earnings Presentation
19 slides from Science's earnings presentation, Mar 9, 2021
Slide 1: 2020 Preliminary Results
2020 Preliminary Results Martyn Ratcliffe Chairman To be read in conjunction with the audited preliminary results Sameet Vohra announcement released on 9 March 2021 Chief Financial Officer In addition to IFRS measures, alternative performance measures are Dan Edwards used in this presentation. Refer
Slide 2: Summary
Summary Record revenue and adjusted operating profit, ahead of upgraded expectations, notwithstanding global pandemic and associated economic impact Successful integration and turnaround of Frontier Smart Technologies with strong profit contribution. Future strategy under review Evolution to three o
Slide 3: Financial Summary
Financial Summary Group revenue of £73.7m (2019: £57.2m) • Record revenue for the Group, benefitting from Frontier acquisition Adjusted operating profit increased by 62% to £10.9m (2019: £6.7m) Reported profit before tax of £6.4m (2019: loss before tax of £1.6m) • Acquisition related intangibles and
Slide 4: Group Revenue and Margin
Group Revenue and Margin • Growth enhanced through acquisitions • >250% increase in revenue without shareholder dilution since 2010 • Consistent margin achieved over extended period • 2019 reflects Frontier initial period with recovery following successful turnaround 80 20% 70 Freehold 60 15% proper
Slide 5: Revenue by Currency/Geography
Revenue by Currency/Geography • 57% of Group revenue is in US dollars and 5% in Euros • 33% of the Group’s business is from North America and 17% directly from Europe • Average GBP/USD rate in 2020 was 1.29 (2019: 1.28) • Average GBP/USD rate in February 2021 was 1.39. Monitoring fluctuations closel
Slide 6: Delivering Shareholder Value
Delivering Shareholder Value • Adjusted basic EPS increased by 67% in 2020 • Adjusted operating profit increased by 62% in 2020 • Since 2010, >300% increase in AOP • Issued share capital (excl treasury) at Dec 2020 in line with Dec 2010 12 24 10 20 Adjusted operating profit (£m) Adjusted operating p
Slide 7: Operating Business Overview
Operating Business Overview Preliminary Results 2020 7
Slide 8: Science Group Business Structure
Science Group Business Structure Property: Third Party Income 1% Science Group plc Frontier R&D Smart Consultancy Technologies Services Freehold 28% 38% Properties Regulatory & Materials R&D Consultancy Regulatory & Frontier Smart Compliance 6% (Sagentia Innovation) Compliance Technologies 27% Mater
Slide 9: R&D Consultancy
R&D Consultancy Overview Financial Summary • Science-led product development and advisory • Services revenue of £28.1m (2019: £28.8m) services including ISO13485 approval for design of • Total revenue of £32.2m (2019: £30.6m) including medical products and (in 2021) small-scale pass-through material
Slide 10: Regulatory & Compliance
Regulatory & Compliance Overview Financial Summary • Scientific advice, registration and compliance of • Revenue of £20.1m (2019: £18.1m) regulated products internationally • c.26% revenue is of a recurring nature • Based Epsom & Knaresborough in UK and • Very strong performance in TSG, particularly
Slide 11: Frontier Smart Technologies
Frontier Smart Technologies Overview Financial Summary • Market leader in DAB/DAB+ radio chips and modules • Revenue of £20.5m (2019: £7.5m, 4 months only) with estimated 80% market share (excluding • Profit contribution of £3.2m, ahead of expectations automotive) • Market share maintained • Acquire
Slide 12: Freehold Properties
Freehold Properties Science Group owns two freehold properties (Harston Mill, near Cambridge and Great Burgh, Epsom) which are managed separately from the operating business • Total income in 2020 was £4.0m (2019: £3.9m) • Income from third party tenants of £0.8m (2019: £1.0m) • Income from intra-Gr
Slide 13: Corporation Tax
Corporation Tax Tax credit in P&L of £0.6m (2019: tax charge of £0.2m) • Underlying tax charge on profits in services business more than offset by recognition of brought forward tax losses in Frontier • £0.6m of Frontier losses utilised in 2020; a further £1.0m recognised and will be utilised in fut
Slide 14: Appendix: Annual Review of Capital Sources & Allocation
Appendix Annual Review of Capital Sources & Allocation Preliminary Results 2020 14
Slide 15: Capital Sources 2010-2020
Capital Sources 2010-2020 • Debt refinancing in 2016 and topped up in 2019 and 2020 • Debt secured against Harston and Epsom freehold properties, limited operating covenants • 10 year term loan fixed at 3.5% using interest rate swap instruments to 2026 • Strong operating cash flow has been primary c
Slide 16: Capital Allocation 2010-2020
Capital Allocation 2010-2020 • Major capital deployments related to acquisitions • Dividend payment outflow in 2020 reduced due to Covid-19 • Equity buy-backs undertaken when appropriate and shares held in Treasury 24 20 16 Dividend £ million Debt Repayment 12 Acquisition Consideration Property, Pla
Slide 17: Cash & Debt 2009-2020
Cash & Debt 2009-2020 • Capital resources deployed for acquisitions (2013, 2015, 2017, 2019) • Strong balance sheet maintained • Debt refinanced in 2016 and loan increased in 2019 and 2020 30 16 25 14 20 12 15 10 10 8 Debt £ million 5 6 Gross Group Cash Net funds/(debt) 0 4 2009 2010 2011 2012 2013
Slide 18: Equity Share Capital
Equity Share Capital • Issued share capital (excl treasury shares) at 31 Dec 2020 in line with Dec 2010 • Acquisitions and investments funded primarily through operating cash flow, resulting in no shareholder dilution since 2010 • Institutional shareholder base expanded 60 50 40 26.3% 27.7% Chairman
Slide 19: www.sciencegroup.com
www.sciencegroup.com Head office Harston Mill Harston, Cambridge CB22 7GG UK Phone: +44 1223 875200 [email protected] 19